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Call Options Plays
Put Options Plays
Strangle Options Plays
CYT None None
FMX    
IPS    
PBR    

New Calls

Cytec - CYT - close: 54.94 change: +1.03 stop: 52.45

Company Description:
Cytec Industries Inc. is a global specialty chemicals and materials company focused on developing, manufacturing and selling value-added products with pro forma sales in 2005 of approximately $3.2 billion. Our products serve a diverse range of end markets including aerospace, adhesives, automotive and industrial coatings, chemical intermediates, inks, mining, plastics and water treatment. (source: company press release or website)

Why We Like It:
It looks like the three-month consolidation following CYT's 2005-2006 run up is about to end. The stock has been building a base between support at its rising 200-dma and resistance near $55.00 for the last several weeks. A few days ago CYT broke out over technical resistance at its simple 50-dma. Now shares look poised to breakout over the $55.00 level. The Point & Figure chart is bullish and currently points to a $64 target. We are suggesting that traders use a trigger at $55.11 to open call positions. If triggered our target is the $59.00-60.00 range. We do expect to see some resistance near $57.50 so expect a pull back but broken resistance at $55 should become new support.

Suggested Options:
We are suggesting the September calls. You choose which strike price best suits your trading style and risk.

BUY CALL SEP 50.00 CYT-IJ open interest= 0 current ask $6.00
BUY CALL SEP 55.00 CYT-IK open interest= 56 current ask $2.40
BUY CALL SEP 60.00 CYT-IL open interest= 35 current ask $0.70

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/20/06 (confirmed)
Average Daily Volume = 313 thousand

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Femsa Fomento - FMX - close: 87.90 chg: +1.47 stop: 85.85

Company Description:
Fomento Economico Mexicano, S.A. de C.V. or "FEMSA" is the leading beverage company in Latin America. It controls an integrated beverage platform that comprises Coca-Cola FEMSA, the largest Coca-Cola bottler in the region; FEMSA Cerveza, one of the leading brewers in Mexico and important beer exporter to the United States; and Oxxo, the largest and fastest growing convenience store chain in Mexico, with over 4,000 stores. (source: company press release or website)

Why We Like It:
After the initial bounce on Friday shares of FMX traded sideways. Investors were waiting to hear the company's earnings report due out after the closing bell. From what we could see the results were positive but we did not see any after hours affect in shares of FMX. Currently FMX has a bullish pattern of higher lows and we suspect that the stock will breakout over resistance at $90.00 soon. The $90 mark looks like significant resistance. If shares can trade over $90.00 it would produce a new quadruple-top breakout buy signal on the P&F chart. We're going to suggest a trigger to buy calls at $90.05. More conservative traders may want to use a trigger at $90.25 or $90.50 just to see little more confirmation. If triggered our target will be the $97.00-100.00 range. Our time frame is four to six weeks.

Suggested Options:
We are suggesting the September calls. You choose which strike price best suits your trading style and risk. FYI: At this time there are only $85 and $90 strikes available on FMX.

BUY CALL SEP 85.00 FMX-IQ open interest= 0 current ask $7.70
BUY CALL SEP 90.00 FMX-IR open interest=10 current ask $4.90

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/28/06 (confirmed)
Average Daily Volume = 524 thousand

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Ipsco - IPS - close: 92.97 change: +1.18 stop: 88.45

Company Description:
IPSCO operates steel mills at three locations and pipe mills at six locations in the United States and Canada. As a low cost North American steel producer, IPSCO has a combined annual steel making capacity of 3,500,000 tons. The Company's tubular facilities produce a wide range of tubular products including line pipe, oil and gas well casing and tubing, standard pipe and hollow structurals. Steel can also be further processed at IPSCO's five temper leveling and coil processing facilities. (source: company press release or website)

Why We Like It:
The iron and steel industry has turned in a mixed performance recently. Normally one might assume that if the economy is slowing down that would be bad for companies like IPS but the stock appears to be breaking out. Shares have been consolidating for the past three months but in the last eight weeks we've seen IPS produce a bullish double-bottom type pattern. Currently short-term technical indicators are positive and the stock broke out over technical resistance at its 50-dma and 200-dma a few days ago. We're suggesting that traders consider buying calls right here near $93 but if IPS does pull back our preferred entry point would be a dip or bounce near $90.75-91.00. We see potential resistance at the 100-dma (currently near $97.50) and its trendline of lower highs (around $100). Therefore we're going to target a run into the $97.00-100.00 range. The P&F chart is bullish and points to a $108 target. We're setting the stop loss under the 200-dma.

Suggested Options:
We are suggesting the September calls. You choose which strike price best suits your trading style and risk.

BUY CALL SEP 90.00 IPS-IR open interest=2679 current ask $7.60
BUY CALL SEP 95.00 IPS-IS open interest=1292 current ask $5.00
BUY CALL SEP 100.0 IPS-IT open interest= 637 current ask $3.20

Picked on July 30 at $ 92.97
Change since picked: + 0.00
Earnings Date 07/25/06 (confirmed)
Average Daily Volume = 674 thousand

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Petroleo.Brasiliero - PBR - cls: 92.72 chg: +2.14 stop: 87.49

Company Description:
Petroleo Brasiliero is an integrated company that performs in oil and oil byproduct exploration, production, refining, marketing, and transportation, both in Brazil and abroad. (source: company press release or website)

Why We Like It:
If you read the wrap this weekend then you know that Jim believes that oil is due for a significant pull back and oil stocks could see some strong selling as the summer driving season comes to a close in the next three to four weeks. This is based on the available info that the Middle East conflict may be improving soon and there are no foreseeable hurricanes that might threaten the Gulf of Mexico region. Yet in spite of the pull back in crude oil on Friday shares of PBR continued to rally. The stock recently broke out over resistance at the top of its trading range near $90.00. The technical picture is bullish and the P&F chart points to a $106 target. We are going to suggest that readers buy calls on PBR at current levels or on a pull back toward $90. Broken resistance at $90 should now act as new support. Our target is the $99.50-100.00 range. We do not want to hold over the mid-August earnings report.

Suggested Options:
We are suggesting the September calls. You choose which strike price best suits your trading style and risk.

BUY CALL SEP 90.00 PBR-IR open interest=179 current ask $6.60
BUY CALL SEP 95.00 PBR-IS open interest=150 current ask $3.80
BUY CALL SEP 100.0 PBR-IT open interest=163 current ask $2.00

Picked on July 30 at $ 92.72
Change since picked: + 0.00
Earnings Date 08/11/06 (unconfirmed)
Average Daily Volume = 3.4 million
 

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New Strangles

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